Laserfiche WebLink
EXHIBIT F <br /> RESERVE FUNDSURETY GUIDELINE <br /> The Issuer may satisfy the requirement (the "Reserve Fund Requirement") to deposit a specified <br /> amount in the debt service reserve fund (the "Reserve Fund") by the deposit of a surety bond, <br /> insurance policy or letter of credit as set forth below. The following requirements shall be <br /> incorporated in the authorizing document for the Bonds (the "Authorizing Document") in the <br /> event the Reserve Fund Requirement is fulfilled by a deposit of a credit instrument (other than a <br /> credit instrument issued by Financial Guaranty) in lieu of cash: <br /> 1. A surety bond or insurance policy issued to the entity serving as trustee or paying agent (the <br /> "Fiduciary"), as agent of the bondholders, by a company licensed to issue an insurance policy <br /> guaranteeing the timely payment of debt service on the Bonds (a"municipal bond insurer") may <br /> be deposited m the Reserve Fund to meet the Reserve Fund Requirement if the claims paying <br /> ability of the issuer thereof shall be rated "AAA" or"Aaa" by S&P or Moody's, respectively. <br /> 2.A surety bond or insurance policy issued to the Fiduciary, as agent of the bondholders, by an <br /> entity other than a municipal bond insurer may be deposited in the Reserve Fund to meet the <br /> Reserve Fund Requirement if the form and substance of such instrument and the issuer thereof <br /> shall be approved by Financial Guaranty. <br /> 3.An unconditional irrevocable letter of credit issued to the Fiduciary, as agent of the bondholders, <br /> by a bank may be deposited in the Reserve Fund to meet the Reserve Fund Requirement if the <br /> issuer thereof is rated at least "AA" by S&P. The letter of credit shall be payable in one or more <br /> draws upon presentation by the beneficiary of a sight draft accompanied by its certificate that it <br /> then holds insufficient funds to make a required payment of principal or interest on the bonds. <br /> The draws shall be payable within two days of presentation of the sight draft. The letter of credit <br /> shall be for a term of not less than three years. The issuer of the letter of credit shall be required <br /> to notify the Issuer and the Fiduciary, not later than 30 months prior to the stated expiration date <br /> of the letter of credit, as to whether such expiration date shall be extended, and if so, shall <br /> indicate the new expiration date. <br /> 4.If such notice indicates that the expiration date shall not be extended, the Issuer shall deposit in <br /> the Reserve Fund an amount sufficient to cause the cash or permitted investments on deposit in <br /> the Reserve Fund together with any other qualifying credit instruments, to equal the Reserve <br /> Fund Requirement on all outstanding Bonds, such deposit to be paid in equal installments on at <br /> least a semi-annual basis over the remaining term of the letter of credit, unless the Reserve Fund <br /> credit instrument is replaced by a Reserve Fund credit instrument meeting the requirements in <br /> any of 1-3 above. The letter of credit shall permit a draw in full not less than two weeks prior to <br /> the expiration or termination of such letter of credit if the letter of credit has not been replaced <br /> or renewed. The Authorizing Document shall, in turn, direct the Fiduciary to draw upon the <br /> letter of credit prior to its expiration or termination unless an acceptable replacement is in place <br /> or the Reserve Fund is fully funded in its required amount. <br /> F-8 <br />